Billionaire Michael Bloomberg now appears to be entering the Democratic primaries, and The Post’s Jeff Stein reports that this is part of a larger outbreak of public billionaire panic:
His decision came one week after Sen. Elizabeth Warren (D-Mass.) proposed vastly expanding her “wealth tax” on the nation’s biggest wealth holders and one month after Sen. Bernie Sanders (I-Vt.) said America should not have any billionaires at all.The populist onslaught has ensnared Facebook founder Mark Zuckerberg and Microsoft co-founder Bill Gates, led to billionaire hand-wringing on cable news, and sparked a panicked discussion among wealthy Americans and their financial advisers about how to prepare for a White House controlled by populist Democrats.Past presidential elections have involved allegations of class warfare, but rarely have those debates centered on such a small subset of people.
On Sunday’s “60 Minutes,” J.P. Morgan Chase chief executive Jamie Dimon seemed shocked when Lesley Stahl asked him if the $31 million he was paid last year was too much (though he did express support for higher taxes on the wealthy and an expanded Earned Income Tax Credit for the poor).
Meanwhile, money managers are apparently getting panicked phone calls from their high-end clients, wondering if they need to start looking for ways now to shield their riches from President Warren’s grasping hands.
Some of the reaction to the proposals from Warren and Sanders has been genuine outrage, which is perhaps understandable. If you have that much money, you’re forever surrounded by sycophants — both the people who work in your business and the servant class that exists to ease your way through the world — who treat you like some kind of living god. Even politicians prostrate themselves at your feet, because like everyone else, they want you to give them some of your money.
As a result, you inevitably begin thinking that you really are better than normal people — smarter, more creative, more hard-working, and even morally superior. If you weren’t, would the world reward you with such blessings? And isn’t the fact that you’re so rich just evidence that life is fair? So how on earth could it be right to ask you to pay higher taxes?
Now here’s where things get tricky. When anyone asks you — say, an interviewer on a panel at a conference, or a reporter doing a story about a wealth tax — you share your thoughts and express your dismay. You might even take the initiative and write an op-ed about how awful these proposals are. Someone, after all, needs to speak out!
But what you don’t realize is that doing so is actually the single best thing you can do to make a wealth tax a reality. Nothing is better for Warren’s chances of becoming president than to have a bunch of billionaires criticize her. It feeds the story of income inequality and gives that story a handy villain, a bunch of rapacious blood-suckers who think we all ought to be thanking them for hoarding the country’s resources.
And while Warren is the focus of much of this attention, the more focus there is on billionaires, the less it matters whether she’s the next Democratic president or someone else is. Joe Biden, for instance, has some very general ideas that involve increasing taxes on the wealthy, like pretty much every Democrat. He says he wants to reverse the Trump tax cuts and “get rid of the capital gains loophole for multi-millionaires” (I’m not sure what loophole he’s referring to, though I would hope he supports eliminating the special treatment of capital gains and just taxing them as regular income).
But if we spend a year talking about how billionaires have rigged the system, it will increase pressure on all Democrats, the next time they can pass a tax bill, to make sure it hits billionaires hard, even if what they come up with isn’t exactly the Warren or Sanders version of a wealth tax. Biden or another moderate might not be as passionate about it as someone like Warren, but that won’t matter, because the incentives will have lined up to make it a reality.
To be clear, a wealth tax in particular is still unlikely even if Warren is president, because there are enough genuine questions about whether it would be effective to make its passage through the Senate extremely difficult. But the more billionaires keep talking about how their taxes shouldn’t be raised, the more likely it is that their taxes will in fact be raised, one way or another.